Will You Take Advantage of the Homebuyer’s Tax Credit?

by Mike on March 29, 2010

As I’m sure most of you are aware, the 2009 First time Homebuyer’s Tax Credit was extended to April 30, 2010 and current home owners may be eligible. The Worker, Homeownership, and Business Assistance Act of 2009 extends the tax credit through June of 2010, but you must sign a commitment contract by April 30th. So if you are planning to take advantage of the tax credit, you better get a move on. Here’s some highlights:

1st time home buyers can claim up to $8,000 or 10% whichever is less. So if you purchase at $70,000 home, you only get a $7,000 refund

Income must be below $125,000 for individuals and $225,000 for married couples to be eligible

Must be 18 or older

You can’t receive credit on a home that costs over $800,000

Current home owners may be eligible for a $6,500 credit (conditions and restrictions apply)

There is a lot of buzz in the personal finance community about renting vs. buying, when to buy, how much down payment etc. My advice to anyone is not to let the tax credit dictate rather now is the time for you to buy or not. Ask yourself, “Would I be looking to buy a home this year if the tax credit was non-existent?” If the answer is yes, then get moving (literally and figuratively), you only have a few weeks left before the tax credit window closes. However, I would caution anyone from making a purchase strictly for the tax credit.

I will be sharing more my personal decision to buy and the lessons I am learning throughout the process in the newsletter. I just gave it a new title: The Rest Area. I you haven’t subscribed, you can do so using the form on the right, or directly below this post.

What about you?Are you in the market for a new home? Did the tax credit affect the timing of your decision?